Decades ago, supply chain planning was one of the earliest beneficiaries of computerisation. Technology made it possible for otherwise unrelated companies to connect with one another, build supply chains that stretch around the world, and in the process create trillions of dollars of value every year.
Yet the successes of the past don’t mean supply chain planning is fit for the future. The waves of digital transformation that have swept through many industries over the past decade have largely passed it by. As a result, a discipline which prides itself on its ability to think ahead, often spends too much time firefighting and making do with quick fixes using spreadsheets.
Vuealta has been working to re-imagine supply chain planning for the modern era. Our vision is twofold. Firstly, we want to rethink the basic “block and tackling” of supply chain planning, so applications deliver exactly what users today need. Secondly, we believe supply chain planning should be more automated and connected with other functions of the business: finance, sales, workforce, and so on.
We see Anaplan as the perfect way to make those connections, as it is already well-established across all these disciplines. We’re also working with academics from Cranfield University, who are recognised for their thought leadership in the supply chain space.
Drawing on our supply chain insights, our work with Cranfield, and our experience with Anaplan, we’ve identified four new principles of supply chain planning:
1. Intelligent, self-driving, and (largely) automated
The growing prevalence of AI and machine learning in the cloud allows us to automate almost any process. Much as your smartphone will suggest possible spellings as you type text messages, so a “self-driving” supply chain application should be able to sense and respond to day-to-day fluctuations in the supply chain. Here are a few examples:
- A supplier is late fulfilling an order – the system automatically attempts to find an alternate source
- Quoted costs are higher than budgeted – again, the system automatically attempts to find another source
- An order will be late – the system adjusts capacity elsewhere or finds an alternate source to solve lateness
These simple tasks can free up hours of planners’ time, so they can focus on more significant, value-adding activities.
2. Enabling supply chain planners to think like CEOs
Classic supply chain planning depends on three sets of data: supplies in, demand out, and financials. What’s missing in all of that is the wider business landscape, conveyed in macroeconomic data and news.
You only have to look at the uncertainty in today’s world to see this is a big information gap. We believe supply chain professionals should follow the same approach as CEOs, making greater use of external events and data as inputs to decision-making.
For example, if market data point to a spike in the price of a specific commodity, it might be sensible to lock in supplies (and a good price) sooner rather than later. By the same token, news of rising consumer prices and falling living standards might signal an imminent fall in demand, suggesting a need to retrench or reroute shipments where demand might be stronger.
3. “No-code” and easy to customise
Legacy supply chain applications aren’t widely known for their flexibility. Tweaks and adjustments often need to be hard-coded, which in practice means they happen rarely, if ever. The consequence is that, instead of evolving in line with the business, supply chain planning applications are more of a reflection of the past. That couldn’t be further from users’ expectations of today’s cloud-based applications: they expect to be able to change things for themselves, with no technical skills needed.
Our view is: a supply chain system that doesn’t reflect the true nature of the business isn’t fit for purpose. So long as the user has the right privileges, changing a report or updating a process should be as simple as drag-and-drop.
4. An agile, collaborative process
One of the tenets of supply chain planning is that it works best when all stakeholders are involved – suppliers, partners, and other functions within one’s own business. Putting it into practice, however, is tricky; flurries of emailed spreadsheets with inconsistent data is all too often the result.
The challenge of collaborative, multidimensional planning is precisely what Anaplan was developed to address. And the suite of supply chain applications we have built reflect both industry best practice and all that Anaplan has to offer. Where the status quo is inflexible and only adds complexity, our goal is to help people work together, faster. The easier that process becomes, the better it will work.
With uncertainty across global markets higher than ever, the need for properly agile, flexible, and collaborative supply chain planning has never been greater. Businesses must continually adjust themselves to new market realities and unplanned events – and armed with the right solutions, supply chain planning can be at the forefront of those efforts.